A worker has 16 hours of non-sleep time per day to allocate between working, l, and non-market time, L. The worker has two sources of income: labour income, and a fixed capital income k. The consumer's preferences over consumption, C, and non-market time given by the utility function U(C,L)=CL. For this utility function MUC=L and MUL=C. The price of the consumption good is 1 and worker's wage rate is w. (a) Show that the worker's budget equation is given by C+wL=16w+k and show the budget line on a graph. [Hint: l+L=16.] (b) Find the worker's labour supply as a function of the wage rate and the amount of capital income (that is, find l in terms of w and k ). [Hint: Use the budget equation and an appropriate MRS equation to find L.] (c) If k=0, what is the effect of an increase in the wage rate on the worker's labour supply? (d) Interpret your answer in part (c) in term of income and substitution effects. (e) How does your answer in part (c) change if k>0